Signature Aviation swings to loss over Covid-19 challenges

(Alliance News) – Signature Aviation PLC on Tuesday said it delivered a “resilient” 2020 performance despite the impact the Covid-19 pandemic on its results and flight activity.

The aviation services company headquartered in London reported 2020 revenue of USD1.41 billion, down substantially from USD2.26 billion in 2019, reflecting the impact of Covid-19 on US Business General Aviation flight activity.

Signature Aviation’s 2020 pretax loss of USD24.2 million swung from a USD23.4 million profit in 2019 as a result of “significant” declines in flight activity in the second quarter, due to stay-at-home restrictions imposed in response to the pandemic.

Due to the continued uncertainty around the Covid-19 pandemic, and to preserve balance sheet strength and liquidity, Signature Aviation said it will not pay a 2020 dividend. It paid out 4.2 US cents per share in 2019.

Despite its hurt 2020 results, Signature Aviation said it has been “encouraged” by the extent of the recovery in flight operations it has seen since spring 2020.

“However, the outlook remains uncertain and the recovery of activity in our North East region and Europe, Middle East Africa, through both business and international travel, will be essential to deliver further progress,” said Chief Executive Mark Johnstone.

Last Monday, Signature Aviation said NNS UK Investment Sarl-SPF entered into an irrevocable undertaking to vote in favour of the recommended takeover offer by newly formed acquisition vehicle Brown Bidco Ltd.

The takeover vehicle consists of US-based private equity firm Blackstone and former suitor Global Infrastructure Partners, as well as Cascade Investment LLC, a fund that manages Bill Gates’s investments. The offer values Signature at USD4.73 billion, about GBP3.46 billion.

NNS agreed to vote in favour of Brown Bidco’s offer in respected of its 61.5 million shares – an approximately 7.4% stake in Signature’s share capital and 9.2% of shares eligible to vote on the scheme at the upcoming March 18 court meeting. Its obligation to vote in favour lapses if the scheme does not become effective, is withdrawn, or a higher competing unconditional offer is made.

“The resilience of our market leading FBO business model, the quality of our network, our ability to generate positive net cash flow throughout the pandemic and continue to invest in and develop our business has attracted significant interest in the group. The recommended offer for the group from Blackstone, Global Infrastructure Partners and our largest shareholder, Cascade, reflects this and the potential for the group to grow and expand services across our real estate,” Johnstone said.

Shares in Signature Aviation were up 0.3% at 400.20 pence in London on Tuesday.

By Zoe Wickens;

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